Key Takeaways; Cannabis Sector

• Canopy Growth successfully concluded BioSteel sale.
• Jushi filed CA$600 million shelf prospectus for strategic flexibility.
• MTL Cannabis reported soaring Q2 revenue after merger.
• 22nd Century Group is streamlining operations by selling its hemp division for $2.25 million.
Key Takeaways; Psychedelic Sector
• Awakn’s recent regulatory and ethical approval for a Phase III clinical trial was highlighted.
• Numinus Wellness reported revenue surge for fiscal year 2023, despite margin challenges.

As we enter the last month of 2023, the cannabis sector remains in the spotlight, showcasing notable developments and market dynamics. In the aftermath of a turbulent October, cannabis stocks made significant strides in November, with the Cannabis Stock Index rebounding from a substantial loss. However, despite a promising start to December, the index still grapples with a 17.5% decline for the year. This year’s narrative has been dominated by the anticipation of potential rescheduling within the cannabis industry. The shift, which is expected to move cannabis from Schedule 1 to Schedule 3, carries significant implications for the industry. However, the timeline and certainty of this adjustment remain elusive.
Below is a weekly roundup on the cannabis and psychedelic sectors.

Top Marijuana Companies for Week

#1: Canopy Growth

Canopy Growth Corporation (CGC: NASDAQ) announced the successful completion of two significant sale transactions involving BioSteel Sports Nutrition Inc. and BioSteel Manufacturing, LLC. The proceedings were carried out under the Companies’ Creditors Arrangement Act (CCAA), resulting in combined gross proceeds of $30.4 million.
The first transaction involved the sale of BioSteel Canada’s assets to the Coachwood Group, as outlined in the asset purchase agreement dated November 9, 2023. Simultaneously, another sale transferred the assets of BioSteel Manufacturing to a third party, in line with a separate asset purchase agreement dated the same day.
The completion of these deals marked a crucial step in Canopy Growth’s restructuring strategy, as the company aims to streamline its operations, focusing more on its core cannabis business and adopting an asset-light operating model. The company stated that they plan to utilize a portion of the proceeds to repay debt, leading to a further reduction in interest expenses.
Judy Hong, Canopy Growth’s Chief Financial Officer, highlighted the significance of these transactions, emphasizing their role in improving the company’s balance sheet. “With the completion of these two sale transactions, we have completed another critical action to focus Canopy Growth’s business on our core cannabis operations and can now realize the proceeds of sale to further improve the Company’s balance sheet,” said Hong.

#2: Jushi Holdings
Jushi Holdings Inc. (OTC: JUSHF), a Florida-based cannabis multistate operator, submitted a preliminary short-form base shelf prospectus in Canada with the goal of raising up to $CA600 million (approximately $442 million). This filing allows Jushi to issue a variety of securities over a 25-month period, including subordinate voting shares, preferred shares, subscription receipts, debt securities, convertible securities, warrants, and units.

The primary purpose of this filing, as stated in the news release, is to maintain financial flexibility. Jushi said that they aim to be well-positioned to respond to significant regulatory improvements and pursue opportunistic acquisitions within the cannabis industry. The filing was made with the securities commissions for each of Canada’s provinces and territories. The terms of any future offerings of securities using this shelf prospectus will be outlined in a prospectus supplement, providing further details and specifications.
This move follows Jushi’s closure of a private offering almost a year ago, which successfully generated proceeds totaling $72 million. The latest filing reflects the company’s strategic approach to secure financial flexibility and capitalize on emerging opportunities in the evolving cannabis market.

#3: MTL Cannabis

MTL Cannabis Corp. (CSE: MTLC) announced impressive financial results for the quarter and half-year ending September 30, following a reverse takeover with Canada House Cannabis Group Inc. in July. Formerly known as Montréal Cannabis Médical Inc., the newly merged Canadian company reported a remarkable 366% increase in revenue, reaching C$23.15 million, compared to C$4.96 million in the same quarter the previous year.
Net revenue also experienced a substantial surge, reaching C$19 million for the quarter, up from C$3.89 million in the corresponding quarter of 2022. Additionally, the company reported a gross profit of C$6.3 million, a significant improvement from C$1.25 million in the same quarter last year.
Positive trends were also observed in operating income, which turned positive at C$843,359, a notable improvement from a loss of C$91,811 in the same period last year. Net income followed suit, with the company reporting C$1.99 million, a reversal from a loss of C$604,314 in the previous year’s quarter.
The positive financial changes were also evident in the company’s cash flow statements. Net cash inflows from operating activities amounted to C$7.3 million, compared to a net outflow of C$1.97 million in the same period last year. However, the company used C$162,255 in investing activities and C$4.64 million in financing activities during the quarter.
MTL Cannabis CEO, Michael Perron, attributed the success to the company’s focus on quality and dedication to providing excellent products and services to recreational customers and medical patients. He stated, “Our focus on quality and dedication to providing the best products and services to our recreational customers and medical patients has been the foundation for our business, and we are seeing that focus being reflected in our financial results.”
#4: 22nd Century Group
Biotech company 22nd Century Group, Inc. (NASDAQ: XXII) initiated the sale of its hemp operations, valued at $2.25 million, in a strategic move to streamline operations and reduce costs. The majority of its GVB Biopharma division is set to be acquired by Specialty Acquisition Corp., a Nevada-based entity with affiliations to current GVB employees. The deal comprises $1 million in cash and a further 12%, $1.25 million promissory note.
The decision to sell is aimed at deleveraging 22nd Century’s balance sheet, and the company stated that they plan to utilize the proceeds from the sale for this purpose. The Buffalo, New York-based company will also retain the right to recover an outstanding insurance payout related to a 2022 fire at a GVB manufacturing facility in Grass Valley, Oregon, currently valued at around $9 million.
The transaction is expected to conclude in December, subject to meeting closing conditions, including financing from the buyer and approval from 22nd Century’s senior lender.
Top Psychedelic Companies for Week

#1: Awakn

Awakn Life Sciences Corp. (OTC: AWKNF), recent regulatory and ethical approval for a Phase III clinical trial was highlighted by Benzinga, a leading newsfeed. Recently, Awakn received regulatory and ethical approval for a Phase III clinical trial of AWKN-P001, its lead program designed for the treatment of Severe Alcohol Use Disorder (SAUD). The approval was granted by the U.K. Medicines and Healthcare Regulatory Agency (MHRA) and the Health Research Authority in the UK. The Phase III trial will commence in Q1 2024 with the enrollment of 280 patients.
AWKN-P001 is a groundbreaking treatment that combines the NMDA receptor-modulating drug ketamine with psycho-social support, targeting the most severe form of alcohol use disorder. In prior Phase II studies, the treatment demonstrated promising results, achieving an 86% abstinence rate six months post-treatment, compared to 2% pre-trial and 25% in the current standard of care.
The trial, funded by Awakn, the University of Exeter, and a partnership between the National Institute for Health and Care Research (NIHR) and the Medical Research Council (MRC), marks a pivotal step in Awakn’s commercial journey. The company’s CEO, Anthony Tennyson, emphasized that the regulatory and ethical approval reflects Awakn’s commitment to scientific rigor and patient well-being; “Our Phase 3 clinical trial represents a crucial bridge between cutting-edge science and a commercially viable solution for addressing severe alcohol use disorder,” Tennyson said in a press statement.

#2: Numinus Wellness

Numinus Wellness Inc. (OTC: NUMIF) announced a significant surge in revenue for its fiscal year ending August 31, 2023. The company reported a 256.9% increase in revenue, attributing the growth to expanded services in North America, increased clinic appointments, and a practitioner-friendly licensing model.
In the fourth quarter of 2023, Numinus recorded a revenue of $6.1 million, marking a 1.7% increase from the previous quarter and a substantial 46.8% increase from the same quarter the previous year.
However, the positive trends were accompanied by a decline in gross margin to 29.5% in the fourth quarter of 2023, down from 34.5% in the previous quarter. Numinus attributed this decrease to increased investment in full-time practitioners and varying clinic performances. In response, the company implemented cost-saving measures, including the closure of an underperforming clinic, resulting in reduced operating expenditures of $7.9 million in the fourth quarter, down from $9.2 million in the previous quarter.
Despite the challenges, Numinus successfully lowered its monthly cash burn to under $1 million as of October. The company reported a total cash balance of $8.6 million and working capital of $7.4 million. Numinus expressed optimism about the anticipated approval of MDMA-assisted therapy by the FDA, which, if approved, would open additional opportunities for the company to deploy its unique service model using this alternative treatment modality.

Key Takeaways; Cannabis Sector
• Organigram received C$124.6 million investment from BAT; the company also announced the appointment of an interim CFO.
• Trulieve posts robust Q3 2023 financial results, showcasing strong financial performance, debt reduction, and strategic growth initiatives.
• Canopy Growth reported narrowed Q2 losses, indicating a positive shift amid restructuring efforts.
• Curaleaf’s Q3 results showcased strategic shifts amid expansion and exits.
• TerrAscend achieved record third quarter 2023 results and raised full-year guidance.
• Ascend Wellness impressed in Q3 surpassing revenue estimates by 33%.
Key Takeaways; Psychedelic Sector
• Cybin plummeted 15% following $64 million offering announcement.
• Awakn’s Prof. David Nutt is the world’s top psychopharmacologist according to ScholarGPS.

This week marked another earnings week as majority of multistate operators in the cannabis sector reported their financial results. Below is a weekly overview of the cannabis and psychedelic sectors, summarizing the noteworthy news that impacted the industry during the initial week of November.
Top Marijuana Companies for Week

#1: Organigram
Organigram Holdings Inc. (NASDAQ: OGI) witnessed a remarkable surge of over 35% on Monday following the announcement of a significant C$124.6 million investment from BT DE Investments Inc., a subsidiary of British American Tobacco p.l.c.(LSE: BATS) (NYSE: BTI). British American Tobacco (BAT), a leading consumer goods business, aims to strengthen its strategic partnership with Organigram through this investment.
Organigram stated that the investment will be used to create a strategic investment pool named “Jupiter,” aiming to accelerate Organigram’s growth plans beyond Canada. This includes geographic expansion, technological advancements, and product development. The strategic move will undoubtedly position Organigram as a prominent player in the rapidly consolidating cannabis market.
This strategic partnership between Organigram and BAT was established in March 2021, and has yielded significant progress, particularly through the Product Development Collaboration (PDC) agreement. The PDC is focused on developing innovative cannabis science and research and development (R&D) projects. The collaboration is in the late stages of developing various products, including emulsions, novel vapor formulations, flavor innovations, and packaging solutions, expected to be applied to Organigram’s portfolio in 2024.
In other news, Organigram announced the appointment of Paolo De Luca as interim Chief Financial Officer, effective November 13, 2023. The company said that the current CFO, Derrick West, was transitioning away from the role to focus on health and recovery after surgery. De Luca, the current Chief Strategy Officer, previously served as Organigram’s CFO between 2017 and 2020.

#2: Trulieve
Trulieve Cannabis Corp. (OTC: TCNNF) reported its financial results for the third quarter of 2023, showcasing substantial cash generation and strategic financial moves. The company revealed cash flow from operations of $93 million and free cash flow of $87 million during the quarter. Notable achievements included a reduction in debt through the purchase of $57 million of 2026 notes, resulting in a 16.5% discount to par, and the announcement of the redemption of $130 million of 2024 notes, projecting $20 million in interest savings.
Moreover, Trulieve reported a revenue of $275 million, with 96% generated from retail sales, and achieved a GAAP gross margin of 52%. Additionally, the company opened new dispensaries, expanded its reach outside Florida, and realized a 235% increase in Maryland traffic in Q3 compared to Q2.
The financial highlights also included an anticipated operating cash flow of at least $100 million and free cash flow of at least $70 million for the year 2023. Trulieve also emphasized its focus on strengthening its balance sheet and commitment to non-dilutive measures. Other significant developments that were highlighted included, the redemption of senior secured notes and the filing of amended federal tax returns for a $143 million refund.
The company’s CEO, Kim Rivers, expressed confidence in the company’s strong cash generation, strategic positioning, and readiness for future growth catalysts; “This year our team has done a phenomenal job executing on our plan to generate cash while making investments to support future growth,” said Kim Rivers.

#3: Canopy Growth
Canadian cannabis producer Canopy Growth Corporation (NASDAQ: CGC) showcased improved financials for the second quarter ended September 30, 2023, indicating signs of a potential turnaround. The company reported a net revenue of CAD 70 million, accompanied by a gross margin of 34%, a notable improvement from the negative margin reported in the same period the previous year. Additionally, operating expenses were down nearly 80% at C$30.43 million, and the company reduced costs by C$54 million during the quarter. This positive shift can be attributed to cost-cutting measures and restructuring initiatives that the company has been undertaking.
Canopy Growth’s net revenue, however, fell 21% to C$69.6 million. This indicates that the company is still experiencing liquidity issues, with CFO Judy Hong stating that significant actions have been taken to eliminate near-term debt obligations.
In terms of product development, Canopy Growth expanded its portfolio, resulting in increased market share. The medical cannabis segment reported its fourth consecutive quarter of revenue growth. Internationally, the company stated that they are still focusing on high-growth markets such as Australia and working to obtain EU-GMP certification for its facility in Kincardine, Ontario, to meet global medical cannabis demand.
Despite positive improvements in its U.S. operations and plans for market expansion, Canopy Growth is still facing regulatory hurdles regarding the creation of a new entity that would incorporate both its Canadian and U.S. investments. The company said that they are actively negotiating and engaging in discussions with the U.S. Securities and Exchange Commission to address concerns and explore additional structural amendments for the financial deconsolidation of Canopy USA from Canopy Growth’s results.

#4: Curaleaf
Curaleaf Holdings Inc. (OTC: CURLF) announced its third-quarter financial results on Friday, showcasing a 2% increase in net revenue to $333.2 million compared to the same period in 2022. While this growth was attributed to the company’s expansion and diversification efforts, it fell slightly short of analysts’ expectations by approximately $7 million.
The company reported a net loss of $92.3 million for the quarter, a significant rise from the $51.4 million loss in Q3 2022. This increase in losses was primarily influenced by a non-cash impairment charge related to the company’s exit from operations in Michigan and Kentucky.
Despite the overall net loss, Curaleaf’s retail sector experienced a 6% revenue increase, reaching $273.2 million. This growth was fueled by the launch of adult-use sales in Maryland and Connecticut, as well as ongoing expansion efforts in New Jersey.
Wholesale revenue, however, remained unchanged from the second quarter and showed a 12% decline from the previous year. The company attributed this decrease to strategic inventory reductions.
In addition, the company’s balance sheet reflects an aggressive investment strategy, with $49.4 million in capital expenditure focused on cultivation and retail expansion in key markets. As of the end of the quarter, Curaleaf had $118.1 million in cash and a net debt of $584.6 million.
Geographically, Curaleaf has shifted its focus, with exits from Michigan and Kentucky and agreements to sell its Oregon assets. The company has also made strides in the European market, acquiring assets in Portugal and initiating sales in the U.K. and Poland.

#5: TerrAscend
TerrAscend Corp. (OTC: TSNDF), a prominent North American cannabis operator, reported remarkable financial results for the third quarter ending September 30, 2023. The company’s net revenue surged to $89.2 million, marking a 34.7% increase year-over-year and a 23.7% sequential growth. Notably, TerrAscend achieved a gross profit margin of 53.6%, showcasing a 340-basis point improvement from the previous quarter.
The company’s adjusted EBITDA from continuing operations reached $24.2 million, demonstrating an 89% sequential increase and a 27.1% adjusted EBITDA margin. Encouraged by these positive trends, TerrAscend revised its full-year 2023 guidance, anticipating net revenue and adjusted EBITDA from continuing operations to reach $320 million and $73 million, respectively. This adjustment signifies a robust 29% and 87% year-over-year growth, underscoring the company’s sustained momentum.
TerrAscend’s impressive financial performance is attributed to several strategic moves, including the successful transition to adult-use sales in Maryland, strengthened market share in New Jersey, improved gross margins in Michigan, and renewed growth in both retail and wholesale sectors in Pennsylvania. The company’s expansion strategy, from ‘deep, not wide,’ is evolving to ‘deep and wide,’ reflecting its confidence in capitalizing on emerging opportunities while maintaining control over its terms.
In addition to financial achievements, TerrAscend celebrated operational milestones during the third quarter, marking its eighth consecutive quarter of sequential net revenue growth and the fifth consecutive quarter of positive cash flow from continuing operations. The company also secured the second position in the New Jersey market, boasting an 18.6% market share.

#6: Ascend Wellness
New York-based Ascend Wellness Holdings, Inc. (OTC: AAWH) reported a robust third-quarter performance, exceeding analysts’ revenue estimates by an impressive 33%. The company’s strategic initiatives, which include cost-cutting measures and operational optimization, played a crucial role in achieving these strong results.
Ascend’s gross revenue for the period ending September 30 rose by 26.6% from the previous year, reaching $169.9 million. Net revenue, excluding internal sales impact, demonstrated an even more substantial growth of 27%, successfully mitigating broader retail challenges. Additionally, the company’s emphasis on same-store sales proved fruitful, with retail revenue increasing by 22.3% to $101.3 million, particularly driven by strong consumer demand, especially in Maryland where adult-use sales commenced earlier this year.
Ascend’s wholesale operations also flourished, experiencing a notable 33.4% rise in gross revenue year-over-year, reflecting a well-received wholesale strategy in a market evolving in sophistication and scale.
Despite reporting a net loss of $11.2 million, there was a marked improvement compared to the previous year. The adjusted EBITDA improved by 38.5% from the previous quarter, with sequential margin growth of 356 basis points. Moreover, Ascend’s financial position, with $63.9 million in cash and cash equivalents, provides a cushion, although the company maintains a net debt position of $243.5 million. The operational cash flow was also encouraging, with Ascend generating $24.2 million in the quarter, marking its third consecutive period of operational cash positivity.
Newly appointed CEO John Hartmann expressed optimism, stating, “In my first full quarter as Ascend’s CEO, we’ve been diligently optimizing operations and fortifying our team. Early signs of results are encouraging.”

Top Psychedelic Companies for Week

#1: Cybin
Cybin Inc. (NYSE: CYBN) announced a firm commitment underwritten offering of 66,666,667 units at a price of US$0.45 per unit. This move aimed to generate approximately US$30 million in gross proceeds, with an additional US$34 million possible upon full exercise of the warrants. The units comprised common shares and purchase warrants, with A.G.P./Alliance Global Partners serving as the sole book-running manager for the offering. The closing was expected around November 15, 2023, pending market and customary conditions, including approval from the Neo Exchange Inc.
The net proceeds, designated for advancing the CYB003 and deuterated DMT programs and general corporate purposes, were part of a prospectus supplement filed with the Ontario Securities Commission and the United States Securities and Exchange Commission (SEC). Prospective investors were advised to review the Base Shelf Prospectus and related documents before making investment decisions.
Simultaneously, Cybin suspended sales under the Lincoln Park Capital Fund agreement, which allowed the company to issue common shares to LPC. The decision to halt purchases under this agreement aligned with the company’s strategic focus on the ongoing public offering.
This announcement triggered a notable 15% drop in Cybin’s stock value on the same day, reflecting the market’s response to the significant financial decision.

#2: Awakn
In a groundbreaking achievement, Prof. David Nutt, a renowned figure in the field of psychopharmacology, was ranked as the world’s leading psychopharmacologist by ScholarGPS. This prestigious acknowledgment is not only a testament to Professor Nutt’s remarkable career but also a reflection of his current role as a vital part of Awakn Life Sciences Corp. (OTC: AWKNF), a company committed to developing innovative treatment options for individuals struggling with addiction.
The recognition of Prof. Nutt as the world’s top psychopharmacologist is not just an accolade; it is a reflection of his profound dedication to improving the lives of those affected by addiction. As the leader of Awakn’s distinguished team, Prof. David Nutt plays a pivotal role in developing groundbreaking treatments for addiction. This milestone serves as a testament to the dedication and commitment of Awakn Life Sciences in their mission to address addiction-related challenges with innovative, science-based solutions.
The partnership between Awakn Life Sciences and Prof. David Nutt stands as a beacon of hope for those who have struggled with addiction, as well as a testament to the power of science and innovation in addressing one of society’s most pressing health crises. This collaboration marks a significant step forward in the ongoing battle against addiction.

Key Takeaways; Cannabis Sector
• Aurora resolved a patent dispute with Willow Biosciences; they also announced Q2 conference call.
• Canadian cannabis giant Tilray has taken a green leap with hemp packaging to reduce plastic waste.
• 22nd Century Group slashed debt by $8.1 million in a strategic move.
Key Takeaways; Psychedelic Sector
• COMPASS Pathways announced a CFO transition.
• Cybin secured additional patents for its DMT program, expanding its psychedelic portfolio.
• Awakn’s Prof. David Nutt is the world’s top psychopharmacologist according to ScholarGPS.
Below is a weekly roundup on the cannabis and psychedelic sectors. In this ever-evolving landscape, we explore the major developments and groundbreaking initiatives happening among companies operating in these industries; from advancements in medical research, therapeutic applications to shifts in legal frameworks and current market trends.
Top Marijuana Companies for Week
#1: Aurora Cannabis
Aurora Cannabis Inc. (NASDAQ: ACB), recently announced the settlement of a patent dispute with Willow Biosciences Inc. (OTC: CANSF). The dispute, which began in July 2021, centered around allegations that Willow’s biosynthetic process for synthesizing cannabinoids had infringed on patents co-owned by Aurora, the University of Saskatchewan, and Canada’s National Research Council.
The patented technology in question was developed by Jonathan Page, the co-founder of Anandia Labs and former chief science officer at Aurora, along with his colleagues. Their work at the University of Saskatchewan and the NRC involved identifying key enzymes and corresponding genes in the biosynthetic pathways of cannabis plants.
Aurora acquired Anandia in 2018 and initiated the patent infringement action against Willow. While the settlement terms remain confidential, Aurora’s CEO, Miguel Martin, expressed satisfaction with the resolution, emphasizing the importance of protecting and enforcing their intellectual property rights. He also underscored Aurora’s pioneering role in genetics work within the Canadian cannabis industry.
Additionally, in other news related to Aurora Cannabis, the company announced that it has scheduled a conference call to discuss its financial results for the second quarter of fiscal year 2024 on November 9, 2023. The call will be hosted by Aurora’s Chief Executive Officer, Miguel Martin, and Chief Financial Officer, Glen Ibbott. The financial results are set to be reported after the close of markets on the same day.
#2: Tilray
Tilray Brands, Inc. (NASDAQ: TLRY), a prominent Canadian cannabis producer, initiated a significant effort to reduce the use of single-use plastics in its packaging and product components. This transition includes converting packaging, pre-rolls, and vape components to hemp-based materials. This move is considered the first major commitment by a large Canadian cannabis producer to address the issue of plastic waste in the industry and could potentially set a precedent for others to follow.
Tilray estimates that its new hemp-based packaging program will divert approximately 131,000 kilograms (288,805 pounds) of plastic waste from landfills each year. The environmental impact of cannabis legalization in Canada has drawn attention, with packaging waste being a prominent concern.
A report by a government-appointed panel highlighted the challenges of recycling plastic cannabis packaging, particularly vaping cartridges and batteries, due to the presence of metal, glass, electronics, and batteries. It was also pointed that Canadian cannabis companies have been producing more products than they can sell, resulting in excess inventory.
Tilray stated that its transition to hemp-based packaging will commence with its Good Supply brand and later expand to include other brands like Riff and Broken Coast. According to the company, the Good Supply hemp initiative will include eco-friendly “hemp tubes” for pre-rolls and Pax Pods cartridges and hemp-composite mouthpieces for 510 vape cartridges. Furthermore, Tilray will replace plastic bags for whole-flower products with bags made from recycled content, diverting an estimated 38,000 kilograms of plastic waste from landfills annually.
The company believes that this initiative is beneficial for both business and the environment, citing research that shows consumers are 50% more likely to purchase cannabis products in sustainable packaging. The move could potentially influence competitors in the cannabis industry to adopt similar eco-friendly practices. Tilray originally pledged to adopt hemp-based packaging during a conference call with stock analysts in January 2023, with the goal of diverting thousands of kilograms of plastic waste from landfills.
#3: 22nd Century Group
Hemp biotech company 22nd Century Group, Inc. (NASDAQ: XXII), specializing in hemp, tobacco, and hops, successfully decreased its senior secured debt by $8.1 million. This achievement followed an amendment and waiver process with its lenders, reducing the outstanding debt from $22.1 million to approximately $14 million.
This significant reduction stems from a waiver and repayment of the required $7.5 million minimum cash balance specified in the original debenture agreements. Furthermore, an existing promissory note was reassigned as part of the deal, with $600,000 of the note allocated to reduce the outstanding principal and $2 million directed towards lowering the put price associated with the lenders’ outstanding warrants, a portion of which was subsequently canceled.
The remaining principal loan balance of $14 million and the outstanding $500,000 of the put price are now due at maturity in 2026, following the original terms of the debenture agreements. Chief Financial Officer, Hugh Kinsman, noted that this principal reduction will save 22nd Century Group approximately $500,000 in cash annually, emphasizing the company’s commitment to actively manage their balance sheet and focus on cost reduction initiatives.
Top Psychedelic Companies for Week
#1: Compass Pathways
COMPASS Pathways plc (NASDAQ: CMPS) recently announced the departure of its Chief Financial Officer, Mike Falvey, who is set to leave the company on November 3, 2023, to explore new opportunities. The company stated that Mary-Rose Hughes, who is currently serving as the Vice President of Finance, will take on the role of interim CFO with immediate effect, while the company initiates a search for a permanent replacement.
Compass Pathways expressed its gratitude to Mike Falvey for his leadership and substantial contributions during his tenure, highlighting his pivotal role in their recent successful private placement. According to Compass, this financing round not only extended the company’s cash runway, ensuring financial stability beyond expected phase 3 clinical data milestones, but also attracted significant investments from leading biotech investors.
The company stated that Mary-Rose Hughes, who joined Compass in May 2020 as its second finance team member, is well-versed in the company’s operations and has been instrumental in overseeing various financial aspects, including treasury, tax, financial planning and analysis, and external reporting. She also played a crucial role in Compass’s initial public offering (IPO), follow-on public equity offering, term loan facility, and private placement financing.
Furthermore, Compass Pathways informed investors that they will release their financial results for the third quarter of 2023 and provide updates on recent business developments on November 2, ensuring transparency and ongoing communication with their stakeholders.
#2: Cybin
Cybin Inc. (NYSE: CYBN) received two patent grants from the United States Patent and Trademark Office, bolstering its deuterated N, N-dimethyltryptamine (DMT) program. Following its recent acquisition of Small Pharma Inc., Cybin now boasts 32 granted patents and over 170 pending applications, establishing a commanding position in the development of innovative tryptamine-based therapeutics.
The two newly granted patents offer protection for Cybin’s deuterated DMT program, covering composition of matter, medical use, and the synthesis of certain DMT analogs. These patents are essential in safeguarding Cybin’s proprietary deuterated DMT compounds, CYB004 and SPL028, both of which are currently in Phase I clinical trials. These compounds aim to provide an extended DMT psychedelic experience with a short-duration drug profile, allowing for optimized dose formulations and distinct therapeutic benefits. Preliminary findings indicate that both CYB004 and SPL028 are well-tolerated and elicit a psychedelic experience lasting under an hour.
#3: Awakn
In a groundbreaking achievement, Prof. David Nutt, a renowned figure in the field of psychopharmacology, was ranked as the world’s leading psychopharmacologist by ScholarGPS. This prestigious acknowledgment is not only a testament to Professor Nutt’s remarkable career but also a reflection of his current role as a vital part of Awakn Life Sciences Corp. (OTC: AWKNF), a company committed to developing innovative treatment options for individuals struggling with addiction.
The recognition of Prof. Nutt as the world’s top psychopharmacologist is not just an accolade; it is a reflection of his profound dedication to improving the lives of those affected by addiction. As the leader of Awakn’s distinguished team, Prof. David Nutt plays a pivotal role in developing groundbreaking treatments for addiction. This milestone serves as a testament to the dedication and commitment of Awakn Life Sciences in their mission to address addiction-related challenges with innovative, science-based solutions.
The partnership between Awakn Life Sciences and Prof. David Nutt stands as a beacon of hope for those who have struggled with addiction, as well as a testament to the power of science and innovation in addressing one of society’s most pressing health crises. This collaboration marks a significant step forward in the ongoing battle against addiction.

Key Takeaways; Cannabis Sector

• Trulieve is challenging 280E cannabis taxation, seeking $143 million federal tax refund.
• TerrAscend raised its full year 2023 guidance, triggering a surge in stock price.
• Red White & Bloom won the race to acquire Aleafia Health after an earlier stumble.

Key Takeaways; Psychedelic Sector

• Atai strengthened investment in IntelGenx technologies.
• Awakn’s Prof. David Nutt is the world’s top psychopharmacologist according to ScholarGPS.

Below is a weekly roundup on the cannabis and psychedelic sectors. In this ever-evolving landscape, we explore the major developments and groundbreaking initiatives happening among companies operating in these industries; from advancements in medical research, therapeutic applications to shifts in legal frameworks and current market trends.

Top Marijuana Companies for Week

#1: Trulieve

Trulieve Cannabis Corp. (OTC: TCNNF), a major player in the U.S. cannabis industry, is embroiled in a significant tax dispute with the federal government. The company is seeking a massive $143 million tax refund for payments made in the years 2019, 2020, and 2021. Trulieve contends that, based on its interpretation of Section 280E of the Internal Revenue Code, it should not have been required to pay these taxes.

Section 280E is a federal tax provision that prohibits state-legal marijuana companies from deducting standard business expenses, resulting in significantly higher tax liabilities. Trulieve filed amended federal tax returns for the mentioned years and is seeking a refund of the $143 million it believes it does not owe.

While the company’s determination is based on specific legal interpretations, it acknowledged that receiving a tax refund is not guaranteed. The company did not provide detailed information about its legal interpretations, but it stated that it will continue to evaluate its tax position and promised to share additional information as appropriate.

It’s worth noting that despite some states easing their 280E tax burdens on regulated marijuana companies, the federal rule remains in effect and is enforced by the IRS. A report by cannabis-sector analysts estimated that the cannabis industry overpaid its taxes by $1.8 billion in 2022 due to 280E taxes.

The burden imposed by Section 280E could potentially be eliminated if the U.S. Drug Enforcement Administration reclassifies marijuana from Schedule 1 to Schedule 3, as the rule currently applies only to businesses involved in Schedule 1 and 2 controlled substances.

#2: TerrAscend

TerrAscend Corp. (OTC: TSNDF) made waves in the cannabis industry by raising its revenue guidance for 2023 during its recent investor day at the Toronto Stock Exchange. The company’s decision to boost its financial expectations for the year resulted in a 4% surge in its stock price, with shares reaching $1.91.

The updated guidance for 2023 includes a projection of at least $317 million in net revenue and $63 million in adjusted EBITDA from continuing operations. This represents an impressive year-over-year growth of 28% in net revenue and 62% in adjusted EBITDA from continuing operations. TerrAscend’s previous guidance had set these figures at a minimum of $305 million and $58 million, respectively.

Jason Wild, the executive chairman of TerrAscend, expressed confidence in the company’s outlook, stating, “We have good visibility and confidence in the remainder of the year as evidenced by the increase in our full-year guidance. We expect to drive industry-leading revenue growth, continued improvement across all P&L metrics, and positive free cash flow in the second half of the year.”

In addition to the revenue adjustments, the company also anticipates that its gross margin will exceed 50%, and it expects to achieve positive free cash flow from continuing operations in the latter half of the year.

#3: Red White & Bloom

In a significant development in the cannabis industry, Red White & Bloom Brands Inc. (OTC: RWBYF), a prominent multistate operator, succeeded in its bid to acquire Aleafia Health, a Canadian cannabis producer facing insolvency. This move followed a previous attempt by Red White & Bloom to acquire Aleafia, which had encountered obstacles earlier in the year.

After the failed acquisition attempt, RWB has now been selected as the successful bidder for Aleafia and some of its subsidiaries, in line with Canada’s Companies’ Creditors Arrangement Act (CCAA) proceedings. The purchase price for Aleafia, initially presented in a stalking-horse bid, was estimated to be between 25 and 29 million Canadian.

As part of this acquisition deal, the subsidiaries of Aleafia, along with specific intellectual property rights owned, licensed, or leased by Aleafia Health, will be transferred to RWB through a reverse vesting transaction. However, certain assets and liabilities of Aleafia will be excluded from the agreement. Notably, Aleafia will be selling its facility in Grimsby, Ontario, to an unspecified third party.

A court approval hearing for this transaction is scheduled for October 27, with both Aleafia and RWB expecting to finalize the deal in November. RWB is currently active in various U.S. cannabis markets, including Arizona, California, Florida, Illinois, Massachusetts, and Michigan.

Aleafia Health initially initiated a strategic review in response to a loan agreement breach, eventually leading to the failed acquisition by RWB. The cancellation of the earlier deal was influenced by opposition from certain Aleafia debtholders, which consequently led to Aleafia’s entrance into creditor protection proceedings.

Top Psychedelic Companies for Week

#1: Atai

Atai Life Sciences N.V. (NASDAQ: ATAI) took a significant step to bolster its partnership with IntelGenx Technologies Corp. (OTC: IGXT). The medical technology firm, Atai, now owns a substantial 63% stake in IntelGenx after investing $3 million in a private placement in August, with the possibility of increasing this investment in the future.

On October 6, 2023, Atai and IntelGenx signed the Second Amendment and Subscription Agreement Amendments, which became effective on September 30, 2023. According to a joint statement by both companies, this agreement encompassed a second amended and restated loan agreement introducing a Conversion Feature. Additionally, the Subscription Agreement Amendment grants Atai the option to purchase up to an additional 7,401 US Units before August 31, 2026.

IntelGenx specializes in drug delivery and the development and production of pharmaceutical films, offering services ranging from lab-scale to pilot- and commercial-scale production. Atai is keen on utilizing these pharmaceutical films for its psychedelic drug delivery endeavors, thus potentially entering into an exclusive arrangement with IntelGenx for this purpose. Atai’s collaboration with IntelGenx extends to the development of a DMT oral film product.

IntelGenX had previously engaged in a collaboration with Tilray Brands, Inc. (NASDAQ: TLRY) in 2018 to develop a cannabis oral strip. However, in 2021, IntelGenX reported initiating arbitration proceedings against Tilray due to an alleged breach of their 2018 license, development, and supply agreement. As of their latest earnings call, the arbitration hearings with Tilray were ongoing.

#2: Awakn

In a groundbreaking achievement, Prof. David Nutt, a renowned figure in the field of psychopharmacology, was ranked as the world’s leading psychopharmacologist by ScholarGPS. This prestigious acknowledgment is not only a testament to Professor Nutt’s remarkable career but also a reflection of his current role as a vital part of Awakn Life Sciences Corp. (OTC: AWKNF), a company committed to developing innovative treatment options for individuals struggling with addiction.

The recognition of Prof. Nutt as the world’s top psychopharmacologist is not just an accolade; it is a reflection of his profound dedication to improving the lives of those affected by addiction. As the leader of Awakn’s distinguished team, Prof. David Nutt plays a pivotal role in developing groundbreaking treatments for addiction. This milestone serves as a testament to the dedication and commitment of Awakn Life Sciences in their mission to address addiction-related challenges with innovative, science-based solutions.

The partnership between Awakn Life Sciences and Prof. David Nutt stands as a beacon of hope for those who have struggled with addiction, as well as a testament to the power of science and innovation in addressing one of society’s most pressing health crises. This collaboration marks a significant step forward in the ongoing battle against addiction,

Key Takeaways; Cannabis Sector

• Tilray reported improved financial performance in Q1 2024.
• Organigram plans CA$500 million fundraising through securities offering.
• Aurora Cannabis secured CA$34 million in stock deal to address debt and potentially explore expansion through acquisitions.
• Curaleaf announced a CA$16 million offering of subordinate voting shares at C$6 per share.

Key Takeaways; Psychedelic Sector

• Awakn completed a groundbreaking feasibility study on MDMA delivery using Catalent’s tablet tech.
• Numinus Wellness announced a CA$10M ATM offering.

The third quarter just ended, and it appears that most cannabis companies had a good quarter. The cannabis sector saw a boost starting on August 30th when news came out that the Department of Health and Human Services had made recommendations to DEA, urging them to move cannabis from Schedule 1 to Schedule 3. This news caused many companies in the sector to rally throughout August and September. However, the rally slowed down in the first week of October, and most companies have seen a drop from their peak around September 11^th. This drop seems to be because many companies in the sector announced stock offerings to improve their weak finances. Nonetheless, many investors believe that cannabis companies are undervalued and could perform better if rescheduling happens faster and the 280E taxes are reduced.

In this article, we’ll provide a weekly roundup on the cannabis and psychedelic sectors, covering major developments and initiatives in these industries, from medical research to legal changes and current market trends.

Top Marijuana Companies for Week

#1: Tilray

Canadian cannabis producer Tilray Brands, Inc. (NASDAQ: TLRY) showed significant improvement in its financial performance for the first quarter of fiscal year 2024, narrowing its loss to $56 million (equivalent to $77 million Canadian dollars). This positive development came on the back of record-breaking sales, with the company reporting $177 million in revenue, representing a 15% increase compared to the same period in the previous year.

According to the company, these results were primarily driven by the strong performance of its cannabis business, which now commands an industry-leading 13.4% market share in the recreational marijuana sector.

Tilray’s revenue improved across various segments in the first quarter. The cannabis business saw a revenue increase of $70.3 million, a 20% growth compared to the same period last year. Other segments, including distribution and beverage alcohol, also showed growth.

Additionally, Tilray’s international cannabis revenue experienced a substantial 37% increase over the previous year, reaching $14.3 million for the three months ending Aug. 31. As of the end of August, Tilray held $177.5 million in cash and cash equivalents.

Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the first quarter were $11.4 million, down from $13.5 million in the prior year’s quarter. This decrease was due to revenue generated from advisory services related to the HEXO acquisition.

In terms of corporate developments, Tilray closed several key transactions during the quarter, including the acquisition of Hexo Corp., a settlement package with MediPharm Labs Corp. (OTC: MEDIF) related to the Hexo dispute, and the completion of the Truss Beverage Co. deal. Furthermore, the company successfully finalized the acquisition of eight beer and beverage brands from Anheuser-Busch for $85 million.

Looking ahead, Tilray anticipates an adjusted EBITDA between $68 million to $78 million for the fiscal year ending May 31, 2024, and it remains optimistic about achieving positive adjusted free cash flow within the year. These targets will be significant milestones in the cannabis industry, especially considering the current challenges of tight capital markets.

#2: Organigram

In a move aimed at bolstering its financial resources, Canadian marijuana producer Organigram Holdings Inc. (NASDAQ: OGI) filed a preliminary short-form base shelf prospectus with Canadian securities regulators, intending to raise up to CA$500 million (approximately $370 million USD) through a securities offering that will span a 25-month period. Additionally, the company submitted a registration statement to the U.S. Securities and Exchange Commission (SEC).

The company views this prospectus as a strategic step to provide financial flexibility and support its overarching objectives. The finalized base shelf prospectus will enable Organigram to issue various securities during the 25-month period, including common shares, debt securities, warrants, and subscription receipts. Specific terms for each offering will be detailed in a prospectus supplement that will be issued by the company.

It’s noteworthy that Organigram had previously reported having CA$75 million in cash as of July in their third quarter fiscal 2023 financial results, indicating a substantial financial position before this fundraising initiative.

This announcement has sparked interest among investors and industry observers, who speculate about the company’s intentions. Some believe that Organigram is gearing up for potential mergers and acquisitions (M&A) activities. In a previous earnings release, the company mentioned significant progress in research and development, both in terms of scientific advancements and revenue-generating capabilities. These efforts have led to the creation of valuable intellectual property assets that could play a crucial role in the company’s M&A strategy.

However, investors should be aware that such fundraising activities can lead to share dilution, potentially impacting the voting power and economic interests of existing shareholders. Furthermore, an increased supply of common shares, if exercised by option holders, could potentially affect the company’s stock market price.

#2: Aurora Cannabis

Aurora Cannabis Inc. (NASDAQ: ACB), a Canadian cannabis company, recently announced a significant financing agreement with investment bank Canaccord Genuity Group Inc. (CF.TO). This agreement aimed to raise funds for debt reduction and potential strategic initiatives, including acquisitions.

Under the terms of the agreement, Aurora sold 46,250,000 of its common shares to Canaccord Genuity at C$0.73 each, generating approximately C$33.8 million in gross proceeds. Additionally, Canaccord Genuity holds an option to purchase up to an additional 6,937,500 shares, potentially increasing the total proceeds to an estimated C$38.8 million.

According to Aurora, the primary objective behind this capital injection is to alleviate a significant portion of Aurora’s debt burden, which currently stands at around US$25 million. The company stated that the funds raised from the stock deal will be used to retire the outstanding convertible senior notes, providing the company with greater financial stability.

Furthermore, Aurora stated that they remain open to utilizing any remaining funds from the deal for strategic initiatives, with a strong focus on potential acquisitions within the cannabis industry. This approach aligns with the company’s vision of expanding its presence and market share in the ever-evolving cannabis sector.

The deal closed on October 3, 2023. This development marks a significant step for Aurora Cannabis as it seeks to strengthen its financial position and explore growth opportunities in the cannabis market.

#3: Curaleaf

Curaleaf Holdings, Inc. (OTC: CURLF), a prominent player in the U.S. cannabis industry, made a significant announcement regarding its financial operations. The company, which is well-known for its extensive range of consumer cannabis products, announced the pricing details for its underwritten offering of subordinate voting shares, which will amount to C$16 million in total gross proceeds.

The offering consists of subordinate voting shares, which have been priced at C$6.00 per Offered Security. Canaccord Genuity Group Inc. (CF.TO), which will act as the sole underwriter and bookrunner for the operation, agreed to purchase 2,700,000 Offered Securities from Curaleaf, generating total gross proceeds of C$16,200,000 for the company.

Curaleaf stated that this operation would involve the sale of Offered Securities in several Canadian provinces, excluding Québec. Additionally, the company said that it will also be offered to “qualified institutional buyers” in the United States through a private placement method, utilizing exemptions from the registration requirements of the U.S. Securities Act of 1933, and adhering to applicable state securities laws.

The closing date for the Offering is set for October 3, 2023, subject to meeting market conditions and customary requirements, including those of the Canadian Securities Exchange.

Curaleaf said that they intend to use the proceeds from this offering to fulfill conditions necessary for a potential listing of its subordinate voting shares on the Toronto Stock Exchange (TSX) and to support the working capital requirements of its international business operated by Curaleaf Holdings International. Additionally, the company said that funds will also be allocated for general corporate purposes.

Top Psychedelic Companies for Week

#1: Awakn

Awakn Life Sciences Corp. (OTC: AWKNF) completed a groundbreaking feasibility study exploring a novel method for delivering MDMA using Catalent Pharma Solutions’ orally dissolving tablet (ODT) technology. The study, which commenced in February 2023 at Catalent’s Swindon, UK facility, sought to determine if MDMA could remain stable and be optimally absorbed in the mouth before reaching the stomach when delivered using Zydis ODT technology.

The results of the research were highly positive, demonstrating that MDMA absorption in the mouth is viable using this innovative approach.

Anthony Tennyson, the CEO of Awakn, expressed optimism about the results and the potential benefits this innovative delivery method could bring to patients. “We look forward to the results, and my hope is the testing will demonstrate that MDMA on Catalent’s Zydis ODT technology will improve the performance of MDMA and provide significant benefits to patients in the clinic compared to MDMA in oral capsules,” Anthony Tennyson said in a statement Wednesday.

David Nutt, Chief Research Officer at Awakn, also conveyed his satisfaction with the study’s progress, emphasizing the positive data regarding the stability and suitability of Catalent’s Zydis technology for their novel MDMA formulation. He also highlighted the importance of this research in their product development strategy, “This is an important part of our product development strategy, which aims to optimize the delivery of MDMA,” David Nutt said.

Moving forward, Awakn plans to conduct further testing, comparing the performance of their proprietary MDMA formulation using Zydis ODT technology against traditional oral capsule. This development holds the potential to improve the overall effectiveness of MDMA and revolutionize the way it is administered to patients in clinical settings.

#2: Numinus Wellness

Numinus Wellness Inc. (OTC: NUMIF), a Vancouver-based psychedelics company, announced its intention to raise CA$10 million through the sale of common shares as part of an at-the-market equity program. The exact number of shares to be sold will be determined by Stifel Nicolaus Canada Inc., Numinus’ financier, which has an “equity distribution agreement” governing the program.

The company outlined in the press release, that the proceeds generated from the sale of shares will serve various purposes, including general corporate use, funding ongoing operations, addressing working capital requirements, repaying outstanding debts, supporting discretionary capital programs, and potentially financing future acquisitions.

Numinus has faced financial challenges based on its recent financial reports. In the quarter ending on May 31, the company reported operating expenditures of $9.2 million, a net loss of $7.2 million, and had $13 million in cash remaining. Despite these financial hurdles, the company anticipates a significant breakthrough if its MDMA-assisted therapy receives approval from the U.S. Food and Drug Administration in the coming year. According to Numinus, this approval could potentially pave the way for substantial growth and advancement for the company.